Capitalize on Market Drivers
Today’s market for single-family rental (SFR) and built-to-rent (BTR) housing sectors have exploded across headlines as a booming investment opportunity within the real estate industry. With so much noise surrounding these sectors, though, there are four key drivers you need to consider while managing SFR and BTR assets. Understanding these market drivers gives you a competitive edge while investing in and managing SFR and BTR assets.
It’s no secret that the COVID-19 pandemic amplified renter demand for single family homes. Masses of workers transitioned from in-office work to remote work. This continues to affect a large portion of the working population; many workers are continuing remote work in place of commuting. With remote work placing emphasis on the need for larger living spaces, housing demands skyrocketed. Millennials continue to lead movement from urban areas to more suburban locations.
This change isn’t temporary. The SFR and BTR market demand showcases a shifting of a whole generation’s priorities. Rather than viewing a single-family home as an asset, most renters are seeking a combination of more space and flexibility – the perfect recipe for SFR and BTR growth.
Of course, this high demand drives home prices and interest rates. Renting single-family units provides the solution for prospective homebuyers to turn to. As investors in the SFR and BTR sector, this provides opportunity to capitalize on this demand. By aligning with demand needs, SFR and BTR fills the gap that high home prices and interest rates create.
As BTR contenders continue to grab raw land for development, the lack of inventory is continuing to drive value for SFR and BTR asset classes. This ‘perfect storm’ of market drivers: renter demand, high interest rates and lack of inventory allows investment capital to keep flooding in. With this in mind, it’s important to leverage these drivers now to make the most profitable decisions.
SFR and BTR Industry Challenges
Although there are many great market drivers to leverage, managing SFR and BTR assets aren’t as easy as sitting by and watching revenue stream in. Trying to balance operational and investment needs gets exhausting, but it doesn’t have to be.
When faced with the daunting challenge of multitasking so many management responsibilities it’s easy to let certain responsibilities fall on the backburner. Like many SFR and BTR property managers, you might find yourself so focused on moving through to leasing as quickly as possible to score revenue. This feels great until investors are knocking down your door for transparency through reporting. Sound familiar?
It takes time to have the ability to leverage data, time that you probably don’t have on a day-to-day basis. On top of that, you’re expected to facilitate workflow management. Providing transparency into your business process such as critical dates, checklists, status updates and turnaround times are just more ‘to-dos’ than hours available in a workday.
A lot of these challenges come down to the larger issue of lacking the right technology. Right now, you very well could be like many in the SFR and BTR space: manually managing your data with Excel or other platforms that just capture your data. Data that could be leveraged for more transparent reporting is siloed, leaving potential assets hiding right under your nose. Just because that’s how many in the space are handling their data, doesn’t mean it’s the most profitable way.
Letting your data fall to the wayside is like driving blind in the SFR and BTR space. How can you reach your destination if you can’t spot the right exit off the freeway? It’s the same sentiment as not knowing where your success puts you against your competitors. Are you behind your peers, on par or a progressive player within the SFR and BTR space? If you aren’t taking the time to utilize your data as an asset there is no way to find out how you’re performing to adjust accordingly.
How We Support
If you relate to the challenges in the SFR and BTR spaces, not to worry. They are common challenges for a reason. Luckily, our team at Saxony Partners has years of experience in the SFR and BTR spaces. We know the challenges in the space because we’ve seen them and solved them.
Here’s how we help clients in the SFR and BTR spaces gain a competitive edge:
Technology due diligence: Before onboarding a new portfolio of properties (or acquiring another SFR/BTR company), investors must accurately assess the true value of these assets. Saxony Partners can provide the due diligence necessary prior to onboarding to identify potential hidden technology costs or other trap doors that may reduce the value of the asset.
Property onboarding: When a new asset or collection of assets is being onboarded, source systems and data need to be assessed, aggregated, and integrated into a single source of truth. Having a dedicated team to assist with this often-complicated process of property and portfolio onboarding can save serious headaches in the post-acquisition stage.
Yardi: If you are a SFR or BTR company that leverages Yardi as your property management system of record, you have the choice between Yardi’s Single Family Homes module or their Multifamily module. Both modules bring different advantages to the table. Notably, Yardi’s Single Family Homes module incorporates elements of Yardi Voyager and RentCafe while streamlining SFR operations. In addition, SFR and BTR companies often utilize other common Yardi modules like PayScan and Fixed Assets. Saxony Partners is the leading independent Yardi consulting firm, offering a full suite of managed services including support, onboarding, upgrades, reporting, and training.
Reporting: Saxony Partners has a team of dedicated real estate reporting experts that deliver short- and long-term reporting solutions. Drill-down reports, dashboards, SSRS, YSR, custom analytics, FillDocs, Correspondence, operational reports – Saxony Partners can help create and optimize the regular and ad-hoc reports you need. By leveraging new technology and automation, reporting that would have taken hours, days, or weeks, can be executed in a few keystrokes.
Why Saxony Partners for SFR and BTR Support
The expertise of our team makes Saxony so adept at providing the best possible support. It’s critical to have a partner you can trust to provide the right solutions at the right time, especially in the competitive area of SFR and BTR.
All of us on the team come directly from the real estate industry. We know the ins and outs of the industry because we’ve been there, too. Learn more about the services we offer by visiting our Saxony Partners blog or by following us on LinkedIn.